News publishers to Apple CEO: Define Amazon deal terms

Hemani Sheth Mumbai | Updated on August 21, 2020

Apple CEO Tim Cook   -  via Reuters

Apple, Amazon have a 15% revenue share deal; other content publishers want similar deal

Digital Content Next (DCN), an organisation representing news publishers, has written a letter to Apple’s Chief Executive Officer Tim Cook urging him to clearly define the conditions for the company’s agreement with Amazon.

DCN represents The New York Times, the Washington Post, the Wall Street Journal, among others. The letter asked the Apple chief to clarify the terms of its agreement with Amazon that allows the latter provide a smaller cut to Apple for its subscription services.

As per policy, Apple takes 30 per cent of the revenue from in-app subscriptions from apps on its App Store for the first year followed by a 15 per cent cut after the first year.

However, in a recent hearing by the US House Judiciary Committee where Cook had testified, it was revealed that as per a deal struck between Apple services chief Eddy Cue and Amazon CEO Jeff Bezos, the companies agreed to a 15-per-cent revenue share for Apple in regard to Amazon Prime Video subscriptions.

The 15-per-cent cut was for customers who signed up through the iPhone app while no revenue share was to be charged for customers who have already subscribed to the Amazon OTT platform from elsewhere, according to the evidence released by the House Committee post the hearing.

“In response to Rep Hank Johnson’s question on whether the arrangement afforded Amazon is “available to any app developers,” you responded affirmatively that they are available to “anyone meeting the conditions,” read the letter written by Jason Kint CEO Digital Content Next.

“We would like to know what conditions our members — high-quality digital content companies — would need to meet in order to qualify for the arrangement Amazon is receiving for its Amazon Prime Video app in the Apple App Store,” Kint wrote.

It further asked the Apple CEO what can be done to come to a similar agreement for DCN members.

“In keeping with your statement to the Committee, I ask that you clearly define the conditions that Amazon satisfied for its arrangement so that DCN’s member companies meeting those conditions can be offered the same agreement,” Kint added.

Published on August 21, 2020

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